Apple’s App Store can stay closed, but developers can link to outside payments, says appeals court

Date:

An appeals court has upheld the status quo in Epic’s antitrust lawsuit against Apple, affirming a decision that was largely a victory for Apple. In a ruling delivered on Monday, the Ninth Circuit Court of Appeals found that Apple’s closed App Store and security restrictions didn’t violate antitrust law but that Apple couldn’t maintain anti-steering rules that prevent users from learning about alternate payment options.

Apple spokesperson Marni Goldberg provided The Verge with the following statement:

Today’s decision reaffirms Apple’s resounding victory in this case, with nine of 10 claims having been decided in Apple’s favor. For the second time in two years, a federal court has ruled that Apple abides by antitrust laws at the state and federal levels.

The App Store continues to promote competition, drive innovation, and expand opportunity, and we’re proud of its profound contributions to both users and developers around the world. We respectfully disagree with the court’s ruling on the one remaining claim under state law and are considering further review.

Epic Games CEO Tim Sweeney shared a response to the ruling in a thread on Twitter, noting that while “Apple prevailed at the 9th Circuit Court,” the court’s decision to reject Apple’s anti-steering policies “frees iOS developers to send consumers to the web to do business with them directly there” “We’re working on the next steps,” Sweeney adds.

The legal saga all started in 2020 when Apple kicked Fortnite off of the App Store after the app began letting users make in-app purchases using Epic’s own payment processor. This allowed Epic to avoid the up to 30 percent commission that comes with using Apple’s own in-app payment system. Epic Games sued Apple shortly after Fortnite was removed from the App Store, alleging the company engaged in “unfair and anti-competitive actions.”

Judge Yvonne Gonzalez Rogers handed down her ruling in 2021, stating Apple doesn’t have a monopoly on the mobile app market. She instead ordered Epic to pay up for violating Apple’s developer agreement and also told Apple to remove its anti-steering rules, which bar developers from providing information about other forms of in-app payment systems to users. Both Apple and Epic Games appealed the court’s decision in 2021.

While today’s ruling states that the district court “erred as a matter of law on several issues,” it says those errors “were harmless.” It adds that Epic also failed to establish “its proposed market definition” and the existence of “less restrictive alternative means for Apple to accomplish the procompetitive justifications supporting iOS’s walled garden ecosystem.”

“There is a lively and important debate about the role played in our economy and democracy by online transaction platforms with market power,” the ruling states. “Our job as a federal Court of Appeals, however, is not to resolve that debate — nor could we even attempt to do so.”

Apple has taken recent steps in an attempt to address mounting antitrust concerns, such as introducing a way for “reader” apps, like Kindle, Netflix, and Spotify to skirt Apple’s in-app payment requirements by linking to their own sites. Despite this, Spotify still encountered issues when selling audiobooks on its iOS app, leading it to pull audiobook purchases from its iPhone app altogether.

Update April 24th, 4:24PM ET: Updated to add a statement from Tim Sweeney.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Share post:

Subscribe

spot_imgspot_img
spot_imgspot_img

Popular

More like this
Related